Ed Peter and Duxton Capital see top potential in SA agribusiness

THE love-driven canoe ride that brought Ed Peter’s global investments to SA.

Ed Peter of Duxton Capital

LIKE any great yarn, this one begins with a love story.

It reaches back to the waterways of Canada when investment banker Ed Peter discovered a charming South Australian woman seated in the back of his canoe in 1991.

“I was weeks away from marrying someone else,” the chairman and co-founder of agribusiness investor Duxton Asset Management said.

The two fell in love and Mr Peter married Julie 28 years ago, with the couple living in Singapore as he worked in various offices of Deutsche Bank before moving to Julie’s home of Adelaide in 2013.

Now, the power couple owns South Australian farms, vineyards, the 2KW bar and former Westpac building in the Adelaide CBD along with local pubs Stanley Bridge, the Uraidla and Crafers hotels.

Mr Peter’s Australian arm of the Duxton Group, Duxton Capital, has invested in cattle, dairy, fruit, grain and cotton while Duxton Vineyards has vast hectares of vineyards, and Peter also owns Kaesler Wines and Yarra Yerring wineries.

Mr Peter sees vast potential in Australia saying “we’ve the cheapest agriculture land in the world”.

Duxton Water is among his more recent business ventures with Duxton Capital managing the water licenses trading and leasing company floated on the stock exchange in 2016 and now reaching a $1 million market cap.

He and water assets director Alister Walsh have firm plans for the company that was listed in September 2016, paid its first dividend in November last year of 2.3 cents franked to 75 per cent, a second dividend paid in April of 2.4 cents with 55 per cent of the portfolio in water leases.

“We don’t think the market has fully factored in some of the structural shift in water demand that’s out there, that’s the opportunity we think we have in taking on further capital and really growing this business,” Mr Walsh said.

“In the next two years we hope to be a $200 million to $250 million market cap.

“We see ourselves as building a business that’s supporting agriculture producers through the offering of water supply solutions.”

Duxton Capital Australia manages the Duxton Water portfolio, with its most recent investment overview claiming this is the only listed water company of its type in the world with returns expected via leases along with trading in spot allocations to primary producers.

It now manages $106 million in assets mainly across the southern Murray Darling Basin, and Mr Peter thinks it’s a stable investment.

“Australia is the first country in the world to really develop its water market,” Mr Peter said.

“Since the great drought people have got really efficient, we have more than doubled our permanent crops but not our use of water.

“Water is a forever asset, we’ve grandmas and grandpas trusting us with their money, it’s not a tech stock, it’s not about clicks or eyeballs.

“We’re almost a water bank.”

Mr Peter runs his business from an old locally heritage-listed mansion turned into beautiful offices in the Adelaide Hills.

Its 34 Australian staff are based in the Stirling building that was a dilapidated mess inhabited by squatters, rodents and a giant pine tree that had pierced the roof.

Mr Peter could see the potential in this too, and it now also has a tasteful new two-storey building constructed alongside housing another of his business interests, wine importer and exporter Pure Wine Company, along with friends’ yoga studio and business.

His eyes are firmly set on growing agribusiness in SA, having also recently invested in Crows chair Rob Chapman’s plan to build a new port at Lucky Bay on Eyre Peninsula to help with grain exports, this is despite having no interests on the peninsula itself.

“The port was something totally different, it was very much our look at things through the eyes of the farmers, we saw a chokehold on the state,” Mr Peter said.

The former investment banker who was formerly head of Deutsche Asset Management Asia Pacific, Middle East and North Africa after joining Deutsche Bank in 1999 as head of equities and brand manager of DB Switzerland, believes South Australian farmers real opportunity in world markets.

The world is losing the size of the United Kingdom in arable land every two years” Mr Peter said.

“We’re cheap, we’re the cheapest agriculture land in the world, our dollar doubled and our land prices didn’t go up while the rest of the world’s did.

“The way we are looking at Australia and the ag space, if we wanted to feed the global population in a way that makes sense.”